TREASURY

ECOFIN

Sajid Javid: A meeting of the Economic and Financial Affairs Council was held in Brussels on 18 February. The following items were discussed.
	Annual Growth Survey 2014: Guidance on the implementation of priorities agreed at the December European Council on macroeconomic and fiscal matters
	ECOFIN adopted Council conclusions on the annual growth survey. The Government support the Commission’s focus on fiscal consolidation, promoting economic growth and employment, and broadly agree with the Commission’s overall priorities. However, the Government consider that the European semester should focus on the core priorities of growth and jobs, and that these conclusions should not provide a mandate for a justice scoreboard.
	Alert Mechanism Report 2014
	ECOFIN adopted Council conclusions on the alert mechanism report (AMR) which marks the start of the macro-economic imbalance procedure cycle.
	Preparation of G20 Meeting of Finance Ministers and Governors (Sydney, Australia, 22-23 February 2014)
	The Council endorsed the EU terms of reference for the G20 Finance Ministers and Governors meeting in Sydney.
	Discharge procedure in respect of the implementation of the budget for 2012
	The Council, on the basis of a report from the Court of Auditors, approved the recommendation on the discharge to be given to the Commission in respect of the implementation of the general budget of the European Union for the financial year 2012. The UK, along with the Netherlands and Sweden, voted against the discharge of the EU budget and submitted a joint statement expressing disappointment that the Court of Auditors had been unable to give an unqualified statement of assurance for the 19th consecutive year and that the overall error rate had increased.
	Budget guidelines for 2015
	The Council adopted conclusions on the budget guidelines for 2015, which will be its overall reference for the budget year.
	Implementation of the Single Supervisory Mechanism
	The European Central Bank presented its first quarterly report on progress in the implementation of the single supervisory mechanism (SSM). The establishment of the SSM will help to safeguard euro area financial stability and is critical to restoring market confidence over the medium term.
	Current legislative proposals
	The presidency provided information on the ongoing work on financial services dossiers.
	Single Resolution Mechanism
	The presidency updated the Council on the trilogue process with the European Parliament. The UK welcomed the progress made on this file since the general approach was reached at ECOFIN in December 2013, and will be ensuring that it fully respects the unity and integrity of the single market.

ENVIRONMENT FOOD AND RURAL AFFAIRS

Agriculture and Fisheries Council

George Eustice: I represented the UK at the EU Agriculture Council on 17 February. Scottish Minister, Richard Lochhead, and Welsh Minister, Alun Davies, were also present.
	Promotion of EU agricultural products
	The Commission presented the main aspects of the new proposal: a focus on third country markets; ending national co-financing to ensure a level playing field; simplifying the scheme by removing the member state pre-selection process; and expanding the scope of the scheme to cover more products.
	I was broadly in favour of the Commission’s proposal, noting that the scope should include national quality schemes. However, I stressed that for the budget increase to be justified, schemes would need to bring additional revenue into the EU. Many member states called for promotion to be allowed on the internal market; for national co-financing to be maintained; and for member states to continue pre-selecting projects to transmit to the Commission.
	School fruit and milk scheme
	The Commission presented its proposal to merge the existing EU school fruit and school milk schemes mainly on efficiency grounds. I and other member states noted that the proposal to transfer provisions on the fixing of aid rates for these schemes from the Council to the European Parliament would not be consistent with the Lisbon treaty. The dossier will now be discussed in detail at working groups.
	Dairy sector
	The Council discussed a presidency questionnaire on the future of the EU dairy sector following the expiry of milk quotas in 2015. In discussion, two groups emerged: those member states in favour of a “soft landing”—effectively an early end to quota, or a large reduction in quota penalty—and those who wanted market intervention tools which went beyond the recent CAP reform deal and the dairy package.
	I spoke in favour of a stable market, noting the long-established position that quotas would end in 2015. To change the system at this late stage would damage the credibility of the EU to see through long-term policy decisions and give certainty to businesses.
	The Commission recommended that the issues be taken to the special committee on agriculture, discussed with stakeholders and the European Parliament, and returned to Council ahead of the Commission’s planned report on the dairy sector in June 2014.
	Any other business: CAP reform delegated Acts
	In response to an AOB request from 27 member states, the Commission defended the latest CAP draft delegated Acts, arguing that they had taken on board member states comments wherever possible, but were constrained by the terms of the basic Act. I called for a more proportionate system of greening and cross-compliance sanctions, while welcoming the Commission’s commitment to secure a workable minimum activity requirement. Over half of member states intervened with a range of outstanding concerns but there was a widespread view that sanctions should be lower.
	The Commission repeated its defence of progress and urged member states not to delay agreement of the Acts which should be adopted before the end of the current European Parliament.
	African swine fever
	There was widespread support from member states for Lithuanian measures to stop the spread of African swine fever. Poland also confirmed that an infected wild boar had been found 1 km from its border with Belarus. Member states urged the Commission to continue to do all it could to lift the Russian trade ban on EU pork products.
	Severe weather: Slovenia
	Slovenia outlined the impact of a severe snow storm on its agriculture and forestry sector in late January and confirmed that they were planning a call on the EU’s solidarity fund.
	The last three AOB items were concluded quickly and without discussion. They were information from the Commission on the implementation of the innovation partnership for agricultural productivity, information from the Netherlands on the outcome of the third global conference on agriculture, food security and climate change, and a report from Lithuania on the conclusions of the 34th conference of EU paying agencies. On the latter item, the Commission underlined the increasing importance of the work of paying agency directors.

JUSTICE

European Small Claims Regulation

Chris Grayling: The Government have today decided to opt in to the European Commission’s proposal which amends the European small claims regulation.
	The European small claims regulation was agreed in 2007 and has been in use since 1 January 2009. It provides a simplified EU-wide procedure to allow citizens and businesses to pursue cross-border claims with a value of €2,000 or less and to have the resulting judgments recognised for enforcement automatically in another member state. The simplified procedure aims to make dispute resolution for low-value claims cheaper and quicker.
	Following an evaluation of the current regulation the Commission’s proposal aims to increase the knowledge and use of the procedure. The main changes recommended are: an increase in the threshold for a small claim from
	€2,000 to €10,000; a cap on court fees to 10% of the value of the claim; a broadening of what constitutes a cross-border case to include within scope more disputes; and a greater use of technology to decrease costs of service of documents and attendance at hearings—for example, through the use of video conferencing and telephone conferencing.
	The Government do not agree with all of the Commission’s suggestions. They will argue, for example, that it is not appropriate for the EU to set rules on the level of court fees in each member state and they will want to ensure that the text reflects properly the cross-border restriction in article 81 of the treaty on the functioning of the European Union.
	However, they recognise the value of a cross-border small claims procedure for consumers who have had difficulties when buying goods from other member states, holidaymakers wishing to resolve problems encountered when abroad or businesses trading across borders.
	They accept that such a procedure can help the working of the single market and for that reason believe it is in the United Kingdom’s interests to opt in to the proposal.

NORTHERN IRELAND

High Court Judgment

Theresa Villiers: On 21 February, Mr Justice Sweeney ruled that an abuse of process had taken place in the prosecution of John Downey for offences relating to the Hyde Park bombing which took place on 20 July 1982. Mr Downey was part of an administrative scheme set up by the previous Government to deal with so-called “on-the-runs”, that is, people who believed they might face questioning or arrest in connection with terrorist or other criminal offences committed prior to the 1998 political agreement if they returned to the United Kingdom.
	When he was arrested on 19 May 2013, Mr Downey was in possession of a letter from a senior official in the Northern Ireland Office dated July 2007 that read as follows:
	“The Secretary of State for Northern Ireland has been informed by the Attorney General that on the basis of the information currently available, there is no outstanding direction for prosecution in Northern Ireland, there are no warrants in existence nor are you wanted in Northern Ireland for arrest, questioning or charge by the police. The Police Service of Northern Ireland are not aware of any interest in you from any other police force in the United Kingdom. If any other outstanding offence or offences came to light, or if any request for extradition were to be received, these would have to be dealt with in the usual way.”
	It has subsequently become clear that this letter contained an error. Mr Downey was in fact sought for arrest by the Metropolitan Police at that time for charges relating to the Hyde Park bombing, in which four soldiers of the Blues and Royals carrying out ceremonial duties were murdered and seven horses were killed.
	Tragically, later that same day another bomb at Regent’s Park resulted in the murder of seven members of the Royal Green Jackets. The Government remain clear that these were terrible terrorist atrocities that had absolutely no justification.
	The judge concluded that the error had been made by officers of the PSNI. The Northern Ireland Office had sought confirmation before sending the letter that the appropriate checks had been made. It was assured by the PSNI that they had been. As has been made clear by the legal proceedings relating to Mr Downey, an administrative scheme to deal with so-called “on the runs” was in operation from around September 2000. It was devised by the previous Government. The details were not fully set out to Parliament, though the scheme was referred to in July 2002 in the answer to a parliamentary question given by the then Secretary of State for Northern Ireland, John Reid.
	Following the failure of the Northern Ireland (Offences) Bill in 2005-06, the administrative scheme became the only mechanism for dealing with OTRs. Under the scheme inquiries from individuals wishing to establish if they were wanted for arrest over suspected terrorist activities were communicated, by Sinn Fein, through the Northern Ireland Office, to the Attorney-General, who then referred them to the prosecuting authorities and the police. The Government communicated back the response to Sinn Fein via a letter from the Northern Ireland Office.
	On the information available to the police and prosecuting authorities at the time, individuals who were not sought for arrest were informed of this. They were also advised that should new information or evidence of wrongdoing come to light at any point in the future, then they would be subjected to normal criminal proceedings. There was, therefore, no immunity from possible future arrest.
	The current Government looked again at the scheme and decided that any future requests should be referred to the devolved authorities in Northern Ireland, in line with the devolution of policing and justice. The Northern
	Ireland Office subsequently dealt only with pending cases for which requests had been received prior to the general election.
	Our records indicate that around 200 individuals were subject to the scheme. Of those, approximately three quarters were informed by letter delivered through a Sinn Fein representative, that at the time they received the letter, they were not sought for arrest, questioning or charge by police; but that if any new information came to light that this was subject to change.
	This procedure clarified the positions of these individuals who were otherwise unsure whether they remained wanted for arrest. In the light of the recent court judgment, my Department is working with the police and prosecuting authorities to check whether anyone sent a similar letter is wanted for an offence committed before the date of the letter. As policing and justice have been devolved issues in Northern Ireland since 2010, any further requests for the scheme, or clarifications on whether particular individuals remain wanted for arrest, should be directed to the PSNI and devolved prosecuting authorities.
	The Government are looking carefully at the judgment of the court. It is right that time is taken to consider its full implications. The PSNI will wish to reflect on lessons learned from this case and the circumstances that led to the serious error which has occurred.
	As has been stated on a number of occasions, this Government do not support an amnesty for people wanted by the police in connection with terrorist offences. We believe in upholding the rule of law. That is why both the coalition parties strongly opposed the legislation introduced by the Labour Government in 2005 which would have introduced what was effectively an amnesty for so-called “on-the-runs”.